Leaving Money on the Table

Posted on March 13, 2024

Hand painted sign next to a road that says, "zoning kills dreams," across the road from a town hall with cars in the parking lot.

Today’s Morning Buzz is brought to you by Matt Horn, Director of Local Government Services for MRB Group, and grandfather to the shortest-lived goldfish in modern times (R.I.P Jordan – we hardly knew ye). For more information on my interactions with living creatures, check me out on LinkedIn.

What I’m reading: The Secret Tradecraft of Elite Advisors, by David Baker – trying to learn how to better serve all of you…

What I’m watching: “They Called Him Mostly Harmless” on Netflix – a spiraling tale about how super nosy people are about other people’s lives, with a twist at the end that leaves you asking why you even watch television anymore…

What I’m listening to: “Senses Working Overtime” on Apple Podcasts. Because who can get enough of Tobias Funke – and because my “Dr. Funke’s 100% Natural Good-Time Family Band Solution” CDs were all stolen at a college fraternity party. (If you got that joke, we’re new best friends.)


What if I told you that your community is potentially losing thousands of dollars in spendable revenue every week?

One of my favorite topics to work with local governments on is economic development. We get tons of calls from municipalities who are wrestling with how to attract investment into their communities – usually to address opportunities around placemaking, jobs for the locals, or a host of other concerns; but most often, it’s about REVENUE.

There are lots of schools of thought out there about the kind of development that has the best opportunity to lighten the load on residential taxpayers. For the purposes of this post, I’ll focus on retail and restaurant attraction. These check a lot of boxes – the right mix serves local residents, may act as a destination for regional visitors and, let’s face it, who doesn’t love the endless salad and breadsticks at Olive Garden.

When we’re working with communities on comprehensive or strategic planning, residents often lament the wrong mix (or dearth) of retail and restaurant offerings. And, in fact, the most frequently repeated comment is, “why can’t we get a Target?” The truth is that there are lots of reasons that Red Lobster chose to locate two towns over.  

The bulk of this quandary has to do with the market itself. In most cases, municipal leadership can do very little about the market in the near term. Target, TJ Maxx, and Wegman’s all want the same thing – a certain number of people, with a certain level of education, with a certain income, within a certain distance from the center of town. Call me if you want to talk about making that happen.

But let’s assume we have all of that, or that a benevolent developer is willing to look past the pock marks on our demographic profile. The very next thing they want to know is what the community’s development process looks like. This is the one thing that is wholly within the control of the local community (or at least as much control as your neighbors), but it’s the thing developers gripe about the most. You say you’re business friendly, but your permit turnaround time says otherwise.

Do you have bad codes? A bad code guy? An inexperienced planning board? Any one of these, and a host of other issues, can cause pain in the development process. What does that mean for you? Remember that Target you wanted? Well, if they decide to come your way, and begin the development process with you, and get hung up, my very fast math says it’s costing them – and you – significant resources.

Yes, big box retailers and national franchise restaurants want to move through the process smoothly so that their cash registers start ringing (spoiler alert – small, local, friendly businesses want the same thing). When their registers are ringing, so are yours. Sales taxes can only be generated when businesses are open. Property tax enhancements happen when buildings get built. When those things stall, those revenues stall.

Do some research to learn more about revenue generation per square foot – think about all of the revenues to your community that are generated by certain types of development. Whether it’s a Strong Towns approach, with densely-woven urban fabric, sporting local retailers by the dozen; or you’re up for the Platinum Award from the International Council of Shopping Centers, the impacts of a muddled development process are real – and costly.

When the planning board tables the review until next month, openings are delayed, and the registers don’t ring for 30 more days. If the lone code officer is off on Friday, and the C of O can’t get issued until Monday, that’s more revenue down the drain.

Hate Target? Apply the same metrics to Bubble Tea, or whatever else you hipsters are drinking these days. The bottom line is that there is no question that this is within your control, and it’s costing you at least some bucks. Unless you’re flush with cash, some changes couldn’t hurt.

So what can you do to ease the strain here? A couple of ideas: 

  • Drop the Excuses – Fix What You Control: If you are reading this aloud in front of your development staff, they are going to throw out a lot of reasons things get delayed – incomplete applications, inadequate staffing, solar eclipse landed on a workday…I get it. Stuff happens. We can only fix what is in our control. Don’t attribute all delays to things we can’t manage. Optimize the things you can.
  • Measure, Measure, Measure: Review the permit turnaround time data now. I’ll wait. Oh, you want to do it tomorrow. OK. Well, do it soon. Establish a baseline. Make incremental changes, then measure again. Then more changes, and more measuring. Understand which direction you are headed.
  • Listen to Stakeholders: Ask developers where they are getting held up. Prepare for the kitchen sink, and don’t get overwhelmed. It’s important to hear from those who have lived it.
  • Shoot for Clear and Productive: Development regulations and processes should be clear enough that a total novice can read them, and they should produce the type of development you want. If you’re driving down the road and do a Matt Horn triple take at that life-sized beaver statue on the new Buc-ee’s, you might need to calibrate.
  • No Need to Compromise Standards: I can’t say this enough – get the kind of development you want. The right developer isn’t concerned about the rules, she just wants to mitigate risk and is looking for predictability in the process.

Turn your development team from traffic cops into ombudsmen, and you’ll be stacking Benjamins in no time. Now, if you’ll excuse me, I need to return this Aldi cart for my 25-cent deposit.

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